Avoid this Personal Finance Mistake

Failing to update your insurance policies can cost you a lot. It can cost you in extra monthly payments for coverage you no longer need. It can cost you when hazard impacts an uncovered or poorly covered asset.

Your need for insurance may change from year to year. You should review your coverage each year to make sure your insurance covers you well.

Health Insurance

Owing a health insurance policy that included maternity insurance may have been a crucial component of your insurance planning a few years ago. However, if you are past the baby making stage of your life, maternity insurance may just represent a cost with no benefits.

Your need for low deductible insurance may have also passed. If your children are older, you may no longer be concerned about frequent visits to the doctor and my do be just as well served by a higher deductible policy.

Life Insurance

If the amount you have purchased for life insurance will no longer generate the income you want your family to have after you are gone, or will no longer pay for the things you intended it to pay for, it may be time for a review. Conversely, if your assets have grown, you may need less insurance on your life. If your children are no longer minors, you may need less coverage as well.

Auto insurance

If your car has gotten older, you may want to drop the comprehensive and collision coverages on it. You may be surprised at how low a payment you might get for the loss of your car. It may be best to take the money you save by having a lower auto insurance premium and use it to help you save for a new car.

Home insurance

Your home insurance policy should cover, among other things, the cost of rebuilding or repairing your home. If construction costs have gone up in your area since you last updated your coverage, you may want to update your policy.